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Frucor pouring all energies into V

Published: 1:11PM Tuesday June 21, 2011 Source: ONE News

Drinks maker Frucor is energetically pursuing global expansion with its best-selling product 'V'.

The managing director of the company, which also makes Just Juice, Mizone and H2GO, told TVNZ today it is aiming to double its revenue to $1 billion over the next five years.

"Frucor's been on a pretty exciting ride over the last ten years, we've quadrupled in size and we would like to double again in the next five years," said Carl Bergstrom.

Bergstrom, who took over the MD role last month, says the company now earns about half of its revenue outside of New Zealand after the incredible success of its market-leading V energy drink changed the focus of the company.

"V punches above its weight in the New Zealand and Australian markets. In gas stations in New Zealand, V outsells any other beverage by over 60%. Nowhere in the world do I think that happens," he said.

The New Zealand-made drink was developed in 1997 and originally only intended for the domestic market.

But it was such a success that the company put it into Australia by 1999 and now sells it in the UK, South Africa and Europe.

V launched in Spain in January this year and Frucor says it is already selling in over 8000 outlets, nearly as many as in New Zealand.

"Our target market is 18 to 24-year olds. If you find a formula that works, there's no reason it won't work in a number of different countries," he said.

The company is actively looking for new markets, particularly in areas it considers "relatively underdeveloped".

"Energy drinks have been the fastest-growing beverage category internationally now for the last few years but nevertheless there are still markets where they are still relatively new and a good opportunity for us".

Dollar impact

Many manufacturers and exporters are struggling with the high kiwi dollar but Bergstrom says "on face value" it is actually of benefit to the company.

That is due to it importing most of its raw materials and also its biggest export market being Australia where their dollar is even higher.

But he says he is concerned by the rising costs of raw materials and says fruit juice, sugar, aluminum, and plastic have all gone up by 20% to 50% recently.

"Obviously we have to pass those increases on. The issue is that consumers simply buy less, they are not spending any more so if prices go up we simply sell less".

Frucor's history

The company has been through several incarnations in the last 50 years after humble beginnings with Fresh Up in 1962 under the ownership of the Apple and Pear Marketing Board.

It morphed into Frucor which bought several brands and introduced products like McCoy premium juice and flavoured mineral waters.

After being sold to private interests in 1998, briefly listed on the stock market and then sold again, it is now owned by Japanese beverage company Suntory.

The company prides itself on its strong workplace culture and was recently recognised in the 2011 Best Employers in Australia and New Zealand study by Aon Hewitt.